POP GOES THE PIPELINE
Europe just got a rare opportunity to reduce its energy
dependence on Russia. But will it take advantage?

Analysis & Commentary: by Alexandros Petersen
Foreign Policy magazine, New York,  NY, May 2009

On April 9, a major pipeline that carries Turkmenistan's vast natural gas resources to Russia exploded in a massive fireball. According to the Turkmen Foreign Ministry, the blast was caused by a "reckless and irresponsible" decrease in the amount of gas drawn from the pipeline by Russia's state-owned energy company, Gazprom. Pipeline and energy infrastructure explosions are a common occurrence in the former Soviet Union, with hundreds of sometimes devastating incidents every year.

But the explosion in Turkmenistan was unique. It shattered the myth that Russia was a reliable energy partner, and it seems to have pushed Turkmen leaders, most importantly President Gurbanguly Berdymukhammedov, to finally decide in favor of constructing a trans-Caspian gas pipeline to Azerbaijan, with resources flowing from there to Turkey and potentially Western markets.

Berdymukhammedov reportedly called Azerbaijan's President Ilham Aliyev to convey that message. The hint could also not have been clearer on the government's Web site: Turkmenistan now intends "to diversify supply of Turkmen natural gas and build the reliable and stable system to transit Turkmen energy to international markets."

The implications of this decision are momentous for the planned Nabucco pipeline, the operatic project deemed a "strategic priority" by the European Commission. Nabucco would bring gas to Europe via eastern Turkey from Caspian, Iranian, or Iraqi reserves, avoiding Russian-controlled routes.

Although construction on the pipeline's first phase is theoretically ready to begin, major private sector investment has not begun to flow into the project because prospects for its second phase are hazy at best. When confronted with questions on Nabucco, energy company officials simply say, "Show me the gas!"

Iraq's infrastructure is still inadequate to pipe major volumes north through Turkey, not to mention the security concerns involved. Aside from the small question of Iran's controversial nuclear ambitions, north-south energy infrastructure within the country is not developed enough to connect its vast southern gas reserves with Nabucco in the north. This leaves Turkmenistan as the only viable option for making Nabucco a reality.

The Brussels-based European Commission, key European capitals, and U.S. foreign-policy officials keen to see their allies wean themselves off the Russian tap have yet to respond to Berdymukhammedov's message in any substantive fashion. And that is exactly the problem for the West.

Even when Russia missteps in its effort to keep the Caspian close and Europe dependent, Western actors -- who say they are working toward supply diversification and unity in energy security -- fail to take advantage of opportunities in the region.

Almost exactly a year ago, another such opportunity arose: Berdymukhammedov had welcomed an EU delegation including Energy Commissioner Andris Piebalgs and External Relations Commissioner Benita Ferrero-Waldner. In preliminary talks in Ashgabat, the Turkmen side privately offered to "reserve" a token amount of gas -- 10 billion cubic meters (bcm) per year -- for Western consumption.

This was a gesture of solidarity on the part of Berdymukhammedov to test the seriousness of his counterparts. He was clearly hoping that such a gesture would compel them to return with a serious proposal to build a trans-Caspian pipeline and move 30 bcm per year westward.

Instead, Ferrero-Waldner went public with the news of the 10 bcm gesture, trumpeting the offer as if it were a sealed deal. Naturally, Ashgabat withdrew from serious talks and focused instead on more concrete offers from Russia and China.

The pipeline explosion has offered Western decision makers another chance to approach Turkmenistan. But this time, EU or U.S. delegations had better come with private sector representatives in tow to give Berdymukhammedov an offer he can't refuse.

Given Turkmenistan's central role in Europe's energy diversification prospects, and what are sure to be redoubled efforts from Moscow to bring the country back into the fold, Brussels and Washington can't afford to do anything else.

NOTE: Alexandros Petersen is the Dinu Patriciu fellow for transatlantic energy security and associate director of the Eurasia Energy Center at the Atlantic Council of the United States (http://www.acus.org).

LINK: http://www.foreignpolicy.com/story/cms.php?story_id=4939